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TSMC loses some production time due to earthquake

The recent earthquake in Taiwan did have an impact on TSMC’s production, but probably not as great as some in the press have indicated: TSMC loses 40K wafers in quake. This blog gives a more careful reading of the announcement. What it comes down to is “1.5 days loss of wafer movement for the company in total.”

Regardless of whether or not they had to scrap any wafers, 1.5 days of downtime is 1.5 days of not producing wafers in a facility that is costing you an obscene amount of depreciation when it’s not producing wafers. It’s not actually 1.5 days for every facility they have, but they averaged it out. It was obviously worse in Tainan, with Hsinchu barely affected. 1.5 days for the company as a whole is roughly 1.6% of a quarter. That lost time is revenue delayed, though probably not lost. If they’re not already at capacity, they can probably make up the missing wafers for their quota. At the end, it comes down to, “How many wafers did you ship this quarter? How much did you get for them?” As I said, revenue delayed, not lost, but there is a cost associated with that.

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Comments

You are correct of course. But TSMC is a public company and any type of specific loss numbers will be scrutinized by the financial and legal communities. That’s why TSMC and other public manufacturing companies use a manufacturing index or averaged numbers when specific numbers are not available or do not apply.

The problem I have is the term “Lost Wafer Movement” was headlined as “TSMC Loses 40k Wafers in Quake”. It is not correct, nor is it responsible headlining / reporting. My opinion of course.

I think we’re in “violent agreement” here. That’s why I started with pointing out that your blog gave a more considered opinion. That’s also why I wanted to point out that this was only 1.6% of their revenue stream for the quarter. That’s 0.4% for the year. Yawn.